Cellebrite DI Ltd. Q2 FY2025 earnings call

Adam Clammer discussed Tom Hogan's appointment as CEO after his cancer remission. Tom Hogan reviewed quarterly performance, noting 2025 playing out largely as planned with some changes in U.S. Fed sector. Mentioned progress in Inseyets, Guardian, global defense and intelligence sector, and acquisition of Corellium. Highlighted innovation areas like FedRAMP high authorization, mobile research, and AI. Dana Gerner shared her retirement thoughts. David Barter reviewed second quarter results, discussed outlook, and mentioned acquisition of Corellium.

ARR grew 21% to $419 million. Americas represented 54% of total ARR, EMEA 34%, and Asia Pacific 12%. Americas grew 24%, Asia Pacific 21%, EMEA 17%. Inseyets has over 40% of installed base using it. Guardian and Pathfinder grow faster than overall ARR, with cloud-enabled and SaaS solutions at 20% of total ARR. Second quarter revenue was $113.3 million, up 18% from prior year. Gross profit $96.4 million, gross margin 85%. Adjusted EBITDA $27.9 million, up 29% with margin at 24.6%. Ended quarter with 1,216 employees. Cash, cash equivalents and investments $558 million. Free cash flow $29 million for second quarter, $150 million trailing 12 months.

Anticipate third quarter ARR growth in mid-single digits, followed by similar in fourth quarter. Third quarter ARR expected $435 million to $445 million (17%-20% growth). Full year ARR $460 million to $475 million (16%-20% growth). Third quarter revenue $121 million to $126 million (13%-18% growth). Full year revenue $465 million to $475 million (16%-18% growth). Q3 gross margin within 84%-85% target range. Q3 adjusted EBITDA $31 million to $34 million (26%-27% margin). Full year adjusted EBITDA $118 million to $123 million (25%-26% margin). Free cash flow margin expected ~30%.

Forward-looking statements subject to risks and uncertainties. U.S. federal spending dynamics with constrained visibility into new orders. Potential for actual results to differ from forward-looking statements due to various factors discussed in Risk Factors and annual report on Form 20-F.

Q: Shaul Eyal asked about confidence in federal spending recovery and retention rates tied to U.S. federal.

A: Tom Hogan and Marcus Jewell discussed confidence in federal spending recovery and renewal rates with specific examples.

Q: Michael Joseph Cikos asked about transition with Dana and initial findings, and further on federal spending.

A: David Barter and Tom Hogan/Marcus Jewell responded.

Q: Eric Martinuzzi asked about European pipeline.

A: Tom Hogan and Marcus Jewell commented on European progress.

Q: Brian Lee Essex asked about federal sales cycle bottleneck.

A: Marcus Jewell explained sales cycle bottleneck in federal.

Q: Tomer Zilberman asked about Fed environment degradation.

A: Marcus Jewell and Tom Hogan stated no degradation in Fed environment.

Q: Michael Louie D DiPalma asked about resurgence in 2026.

A: Marcus Jewell and David Barter/Tom Hogan discussed drivers for 2026 resurgence